Gold has a long association with Islamic finance. For centuries, the gold Dinar was the currency and trading standard of the Islamic world. But as Islamic finance grew and developed, so did the need for clarity around the Shari’ah treatment of gold: as a Ribawi item, it is subject to strict trading rules. Debate about whether gold is a currency or commodity hampered investment.
This uncertainty was removed following the 2016 launch of the Shari’ah Standard on Gold, which provides a comprehensive framework for the development of gold-backed financial products, including gold ETFs, investment accounts, savings plans and spot contracts. Since the Standard was launched, a number of new Shari’ah-compliant products have been developed.
We have been working with Islamic banks and other financial institutions since 2016 to further develop the market for Shari’ah-compliant gold-backed products. As part of our engagement, in 2018 we partnered with global research agency Kantar TNS to conduct a comprehensive survey of 4,000 retail investors in four predominantly Muslim markets – Saudi Arabia (KSA), United Arab Emirates (UAE), Turkey and Malaysia – to gauge their attitude and approach towards Islamic investing and gold.